France increases tax rates

02.02.2012 29 January 2012 in the framework of another television interview the French President Nicolas Sarkozy spoke about the coming state taxation changes.

Thus it’s planned to increase the current rate of VAT. Already from 1 October 2012 this tax will be levied at the rate of 21.2% instead of the previous 19.6%. In addition, increase of the rate of the French social security tax CSG in 2% (current rate is 8%) is expected.

Another measure of the French companies support, to the opinion of the President, is creation of the State Bank of industrial development financing. The establishment of such a financial institution should have a beneficial effect on the development of industry and the problem of unemployment, which last year reached a record over the past 12 years.

Expert’s opinion

“To the opinion of the French President Nicolas Sarkozy, increase of tax rates will reduce labor costs and increase the competitiveness of the French companies. It seems that France that is still "in the state of euphoria" because of more than positive results of introduced in 2011 wealth tax, is not quite objective for the current economic situation.

Obviously, increase of tax rates has negative impact on investment inflows into the country - and this is one of the most effective sources of state budget replenishment”.

On the basis: www.taxpravo.ru

Vorontsova Maria ( the lawyer of international consulting department of Honest&Bright)